What is the difference between a U.S. Treasury Bill and a U.S. Treasury Note and a U.S. Treasury Bond?

Treasury Bills have a maturity of less than 12 months, have no coupon rate, and are issued at a discount to the par value. When a U.S. Treasury Bill matures it pays the par value only and pays no additional coupon interest. The returns the investor earns for a T-Bill is the difference between the purchase price and the maturity price.

Treasury Notes have a maturity of one to ten years, while Treasury Bonds have a maturity longer than ten years. Treasury Notes and Bonds both have a set coupon rate when they are issued, and will pay interest at the coupon rate and return the capital when they mature.

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